8) Third Party Beneficiaries Flashcards

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1
Q

3rd party beneficiaries: def

A

3rd party who will benefit from promisor’s action in a k

ojo! both parties can be promisors, of different things

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2
Q

3rd party beneficiaries: kinds

A

1) creditor beneficiary (intended)
2) donee b. (intended)
3) incidental b.

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3
Q

3rd party beneficiaries: intended beneficiary: kinds

A

(creditor or donee b)

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4
Q

3rd party beneficiaries: intended beneficiary: def

A

someone the k-ing parties INTENDED to benefit (often, but not nec, named in k)

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5
Q

3rd party beneficiaries: creditor beneficiary: def

A

promisee seeks performance from promisor to satisfy obligation owed to a 3rd party

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6
Q

3rd party beneficiaries: donee beneficiary: def

A

promisee seeks performance form promisor in order to make a gift of that performance to 3rd party

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7
Q

3rd party beneficiaries: incidental beneficiary: def

A

3rd party who will benefit from promisor’s performance as a practical matter, but not intended beneficiaries

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8
Q

3rd party beneficiaries: who can sue??

A

1) must be INTENDED (creditor or donee)

2) can only sue THE PROMISOR (not promisee)

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9
Q

3rd party beneficiaries: vesting of 3rd party rights: result

A

parties may no longer modify or rescind the 3rd party beneficiary provision w/o consent

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10
Q

3rd party beneficiaries: effect on modification

A

parties can only modify/rescind the 3rd party benefit provision w/o consent IF RIGHTS HAVENT VESTED YET

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11
Q

3rd party beneficiaries: vesting happens when:

A

1) beneficiary sues
2) b. changes position in justifiable reliance on the k
3) b. manifests assent to k (at request of promisor OR promisee)
4) rights of beneficiary have vested under express k terms

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12
Q

3rd party beneficiaries: defenses to promisor

A

any valid defenses promisor has ARE ALSO effective against 3rd party beneficiary (but must be from this transaction)

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13
Q

note! material breach is a

A

DEFENSE!

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14
Q

assignment vs offsets

A

obligor (?) can’t offset if knew about the assignment

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15
Q

is beneficiary INTENDED beneficiary? factors

A

: (1) whether the third party is expressly identified in the contract;

(2) whether the agreed performance runs directly to the third party; and
(3) whether the third party could reasonably rely on the contract as having been intended to grant a benefit to him.

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